Snyder makes tax, fee proposals for road repairs

AP Wire
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Jul 21, 2015 at 12:04 PM

Generating new money for Michigan's transportation network was the centerpiece of Snyder's third annual State of the State address, delivered to a joint session of the state Legislature in the Capitol. The Republican governor sought support from both parties midway through a turbulent term in which he has pleased business interests but alienated Democrats and organized labor with tax relief for corporations and measures that have weakened unions' powers.

With studies showing revenues lagging behind Michigan's transportation infrastructure needs, Snyder offered proposals meant to produce $1.2 billion a year for road and bridge repairs, a figure that could rise in subsequent years. Replacing the retail tax on fuels, which has been stuck since 1997 at 19 cents per gallon for gasoline and 15 cents per gallon for diesel fuel, with a wholesale tax would enable revenue to rise with inflation as the cost is passed along to motorists.

Snyder also proposed raising the statewide fee on vehicle registrations and giving local governments the authority to impose further increases for local road and street fixes.

Aides acknowledged it would be difficult to win approval in a legislature where tax-averse Republicans are in the majority, but said the state has no other choice as it seeks to attract new businesses and jobs. Studies show that if nothing is done to generate more funds to fix potholes and repair bridges, 65 percent of Michigan's roads will be in poor condition by 2020, said Bill Rustem, senior policy adviser to the governor.

Elsewhere, Snyder was calling for an array of new initiatives dealing with education, the environment and the economy.

He proposed moving more state social workers into troubled elementary schools, increasing the state's rainy day fund, and creating an agency to prevent insurance fraud.